Exhibit 10.14
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "AGREEMENT") is entered into by CTC
Media, Inc., a Delaware corporation (the "COMPANY"), and Alexander
Rodnyansky
(the "EXECUTIVE").
WHEREAS, the Executive currently serves as Chief Executive Officer
of
the Company, as well as General Director of the Company's
subsidiaries, ZAO Set
Televissionnykh Stantsiy ("CTC NETWORK") pursuant to an employment
agreement
with such company dated June 2, 2002 (the "CTC NETWORK AGREEMENT"),
and ZAO Novy
Kanal ("DOMASHNY NETWORK") pursuant to an employment agreement with
such company
to be entered into in the near future (the "DOMASHNY NETWORK
AGREEMENT"); and
WHEREAS, the Executive and the Company wish to memorialize the
terms of
the continued employment of the Executive by the Company and to
provide for the
common terms of the continued employment of the Executive in all
capacities with
the Company and its direct and indirect subsidiaries (together, the
"GROUP");
NOW, THEREFORE, in consideration of the mutual covenants and
promises
contained herein, and other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Term of Employment. The Company hereby agrees to continue to
employ
the Executive, and the Executive hereby accepts continued
employment with the
Company, upon the terms set forth in this Agreement, effective as
of January 1,
2006. The Executive's employment shall continue until it is
terminated in
accordance with the provisions of Section 5.
2. Title; Capacity.
(a) The Executive shall serve as Chief Executive Officer of
the Company. In addition, the Executive shall serve as a member of
the
Company's operating committee (for so long as such committee
stands)
and participate in key management decisions. The Executive agrees
to
perform such other duties and responsibilities as the Company's
Board
of Directors (the "BOARD") or its designee shall from time to time
reasonably assign to him.
(b) Without limiting the foregoing, the Executive shall
continue to serve as General Director of the CTC Network pursuant
to,
and subject to the terms of, the CTC Network Agreement and General
Director of the Domashny Network pursuant to, and subject to the
terms
of, the Domashny Network Agreement. For purposes of Russian law,
the
Executive's employment by the Company pursuant to this Agreement
shall
be deemed to be the Executive's principal employment; the
Executive's
employment by the other Group entities pursuant to any Other Group
Employment Agreement (as defined below) shall be deemed to be the
Executive's secondary employment.
(c) The Executive shall be based at the Company's headquarters
in Moscow, Russia or such other location as the Company determines
in
its discretion.
(d) The Executive shall be subject to the supervision of, and
shall have such authority as is delegated to him by, the Board.
(e) The Executive agrees to devote his entire business time,
attention and energies to the business and interests of the Group
during his employment with the Company and shall not engage in any
other business activities without the prior written approval of the
Board; provided, however, that the Executive shall be permitted to
retain his board membership for Studio 1+1 in Ukraine for so long
as
the Board does not consider Studio 1+1 to be a competitor of the
Group
and provided, further, that such activities do not materially
interfere
with the Executive's performance of his duties hereunder or under
any
Other Group Employment Agreement. The Executive agrees to abide by
the
rules, regulations, instructions, personnel practices and policies
of
the Company and any changes therein that may be adopted from time
to
time by the Company.
3. Compensation and Benefits.
(a) Base Salary. The Group shall pay the Executive, in regular
installments in accordance with the Group's standard payroll
practices,
an annual base salary of $500,000, less all applicable Russian
federal
and local taxes and withholdings; which shall be the aggregate
annual
base salary payable to the Executive for his services as Chief
Executive Officer of the Company, General Director of the CTC
Network,
General Director of the Domashny Network and any and all other
capacities in which he serves for any Group company from time to
time.
Such salary may be adjusted from time to time in accordance with
normal
business practice and upon mutual agreement of the parties. For the
avoidance of doubt, the total aggregate annual base salary payable
to
the Executive pursuant to this Agreement and the CTC Network
Agreement,
the Domashny Network Agreement and any other employment or service
agreement with any Group company (collectively, the "OTHER GROUP
EMPLOYMENT AGREEMENTS" and, individually, each an "OTHER GROUP
EMPLOYMENT AGREEMENT") shall not exceed the amount as determined in
accordance with this clause (a).
(b) Discretionary Bonus. The Executive shall be eligible for
an annual discretionary award of up to $300,000, less all
applicable
Russian federal and local taxes and withholdings, subject to the
Executive's achievement of performance targets set by the Board or
a
committee thereof; which shall be the aggregate annual
discretionary
award payable to the Executive for his services as Chief Executive
Officer of the Company, General Director of the CTC Network,
General
Director of the Domashny Network and any and all other capacities
in
which he serves for any Group company. Whether such performance
targets
have been achieved will be decided by the Board or a committee
thereof
in its sole discretion. In any event, the Executive must be an
active
employee of the Company on the date the bonus for any fiscal year
is
distributed in order to be eligible for a bonus award. For the
avoidance of doubt, the total aggregate annual discretionary bonus
potentially payable to the Executive pursuant to this Agreement and
all
Other Group Employment Agreements shall not exceed the amount as
determined in accordance with this clause (b).
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(c) Vacation. The Executive shall be entitled to 28 calendar
days of paid vacation per calendar year, at such times as may be
approved by and in the sole discretion of the Board or its
designee.
Any unused vacation time from a particular calendar year may be
carried
forward into the immediately following calendar year but not beyond
that year. The Executive shall document such vacation as required
by
Group procedures and Russian law. Such vacation days shall accrue
at
the rate of 2-1/3 days per month. For the avoidance of doubt, (i)
the
aggregate number of vacation days allowed pursuant to this
Agreement
and all Other Group Employment Agreements shall not exceed the
number
provided in this clause (c) and (ii) vacation days taken pursuant
to
this Agreement or any Other Group Employment Agreement shall be
deemed
to have been taken pursuant to all such agreements.
(d) Transportation. During the term of this Agreement, the
Company shall provide the Executive with the exclusive use of a
luxury
class sedan such as a BMW 7-Series (which shall remain the property
of
the Group).
(e) Personal assistant. During the term of this Agreement, the
Company shall provide the Executive with a personal assistant who
shall
work exclusively for the Executive.
(f) Mobile phone. During the term of this Agreement, the
Company shall provide the Executive with a mobile phone and shall
pay
the line rental and service fees and the cost of any
business-related
calls.
(g) Insurance. During the term of this Agreement, the
Executive shall be entitled to participate in a life insurance
program
that the Company establishes and makes available to it employees to
the
extent that the Executive's position, tenure, salary, age, health
and
other qualifications make him eligible to participate. The
Executive's
coverage under any such program shall be governed by the terms of
the
life insurance policy. During the term of this Agreement, the
Executive
shall be entitled to participate in a health insurance program with
OAO
Insurance Group Energogarant or such other similar health insurance
program that the Executive may select in his discretion, provided
that
the total annual cost of such program to the Company shall not
exceed
$15,000. The Executive's coverage under such program shall be
governed
by the terms of the health insurance policy.
(h) Reimbursement of Expenses. During the term of this
Agreement, the Company shall reimburse the Executive for reasonable
travel or other business-related out-of-pocket expenses incurred in
connection with the performance of the Executive's duties under
this
Agreement upon presentation of receipts and/or other documentation
evidencing such expenses. When traveling on business, the Executive
shall be entitled to be reimbursed for business class air fare but
in
no event shall the Company reimburse the Executive for first class
air
fare.
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4. Taxes. The Executive shall be responsible for all of his own
taxes
payable in Russia or any other jurisdiction in which he is subject
to tax.
5. Employment Termination. The employment of the Executive by the
Company pursuant to this Agreement shall terminate upon the
occurrence of any of
the following:
(a) At the election of the Company, for Cause, immediately
upon written notice by the Company to the Executive. For the
purposes
of this Agreement, "CAUS
